Welcome to CrossDock,

In this issue, we dive into the influence of U.S. presidents on both national and global supply chains. We'll explore the key policies that shaped logistics and trade, examining how presidential decisions have impacted supply chains—both positively and negatively—over the years.

Presidential Policies 🇺🇸

President Bill Clinton signs the NAFTA agreement. Former Presidents Gerald R. Ford, Jimmy Carter, and George H.W. Bush stand in support
Image credit: White House Photograph Office

In 1792, a competition was held to design a new building in Washington, D.C. Nine entries were submitted, but the winning design came from an Irish architect named James Hoban. Drawing inspiration from the elegance of Leinster House in his homeland, Hoban crafted a design that balanced simplicity with strength—embodying the spirit of a new democracy. This design became what we know today as the White House, the residence of the U.S. President.

Since then, the White House and its residents have shaped American life, making decisions that have influenced the country for centuries. Some of these decisions have had a huge impact on trade and supply chains, both in the U.S. and around the world.

Let’s explore how key presidential decisions have transformed supply chains, creating new avenues of growth while sometimes sparking controversy and debate.

Road Trip

When it comes to the American supply chain, no policy has had a greater impact than Dwight D. Eisenhower’s decision to create the Interstate Highway System. The idea was born during World War II when Eisenhower witnessed the efficiency of Germany’s autobahns in moving troops and supplies swiftly across the country.

Inspired by this, Eisenhower envisioned a similar network that could enhance U.S. national defense while radically transforming the country’s transportation and logistics landscape.

In 1956, Eisenhower signed the Federal-Aid Highway Act, setting in motion an ambitious plan to build 41,000 miles of highways crisscrossing the nation. This monumental project, funded at $114 billion (equivalent to around $618 billion today), was nothing short of transformative.

The new highways quickly became the backbone of America’s freight system, dramatically improving the movement of goods from coast to coast. By the 1970s, trucking had overtaken railroads as the dominant mode of transport, with 75% of goods traveling by road, up from 56% in 1960. This shift lowered transportation costs and boosted economic growth, cutting delivery times and enabling businesses to reach new markets more efficiently.

Image credit: Library of Congress

The economic impact was profound. Over its first 40 years, the interstate network generated an estimated $2.1 to $2.5 trillion in economic returns—an impressive 6 to 7.5 times the original investment.

By 1996, the system's benefits were valued between $78 billion and $110 billion annually, driving productivity and reducing consumer costs. Between 1950 and 1989, about a quarter of the nation's productivity growth could be attributed to investments in highways, showcasing the long-term impact of Eisenhower’s far-sighted infrastructure strategy.

Even today, Eisenhower’s vision continues to power the American economy. Highways like Interstate 81 are critical lifelines, especially for moving goods between the Southeast and Northeast. This corridor supports nearly $310 billion in economic activity each year, with over half of its traffic consisting of freight.

Meanwhile, routes like I-40 and I-10 remain vital arteries for cross-country trade, sustaining industries from automotive to retail. These highways are the veins through which the lifeblood of America’s supply chain flows, supporting the modern, just-in-time logistics that keep shelves stocked and packages delivered at record speed.

Trade Agreements

If Eisenhower’s highways connected America’s cities, trade agreements expanded its economic reach beyond its borders. Among the most impactful—and hotly debated—of these agreements was the North American Free Trade Agreement (NAFTA). It wasn’t the product of just one president but rather a collaborative effort that spanned three administrations, each playing a key role in bringing it to life.

The seeds of NAFTA were sown during Ronald Reagan’s presidency, when he envisioned a free trade zone across North America, believing that open markets would drive economic growth and increase competitiveness. Reagan’s vision laid the groundwork, but it was under George H.W. Bush that formal negotiations began.

President Ronald Regan
Image credit: White House Photographic Collection

Bush Sr. was determined to deepen economic ties with Canada and Mexico, seeing free trade as a path to job creation and prosperity. By 1992, after years of negotiation, the leaders of the three nations had signed the agreement.

But there was still one hurdle left: getting Congress on board. This challenge fell to Bill Clinton, who, despite initial reservations, came to embrace NAFTA as a means to open new markets and strengthen the American economy.

To win Congressional support, Clinton added labor and environmental protections to the agreement. In late 1993, after an intense legislative battle, NAFTA was ratified, officially taking effect on January 1, 1994. NAFTA's passage stands as an excellent example of bipartisan cooperation for the greater good, showcasing how leaders can come together despite deep political differences.

Former US President George Bush signed the NAFTA agreement in 1992
Image credit: Agence France-Presse

The effects were immediate. By eliminating tariffs on most goods traded among the three countries, NAFTA supercharged cross-border trade. Within just 15 years, trade among the U.S., Canada, and Mexico had nearly tripled, reaching almost $1 trillion annually. U.S. exports to its neighbors surged from $142 billion in 1993 to over $525 billion by 2018, supporting millions of jobs in various sectors.

What’s more, robust and Integrated supply chains were established, particularly in the automotive industry, where parts often cross borders multiple times before becoming a finished product.

❝

NAFTA will tear down trade barriers between our three nations, create the world’s largest trade zone, and create 200,000 jobs in [the U.S.] by 1995 alone

President Bill Clinton

Yet, the reality was more complex. While NAFTA did increase trade, its effect on U.S. GDP was relatively modest. According to reports, it added an estimated $80 billion to the economy, which is less than a 0.5% increase.

The biggest disadvantage for the American side was job losses, particularly in manufacturing, where cheaper labor in Mexico led to outsourcing. By 2008, the Economic Policy Institute estimated that NAFTA had cost the U.S. around 766,000 jobs, mostly affecting workers in manufacturing towns that struggled to compete with lower-priced imports.

Despite these controversies, NAFTA’s influence on North American supply chains was transformative. It reshaped the region into an interconnected economic zone, optimized supply chains, and played a vital role in transforming Mexico into a major nearshoring hub. Today, Mexico is the number one trade partner of the United States – with the total trade between the U.S. and Mexico reaching approximately $799 billion in 2022.

So, was it NAFTA that offshored manufacturing from the United States?

Made in China

The idea that American manufacturing jobs vanished overnight due to a single policy like NAFTA oversimplifies a much more complex story. The decline in U.S. manufacturing began decades before NAFTA came into play, driven by a mix of policy decisions, economic strategies, and global shifts that redefined how and where products are made.

The seeds of offshoring were sown as early as the 1970s, beginning with President Richard Nixon’s groundbreaking decision to open diplomatic relations with China in 1972. While initially a Cold War strategy to counterbalance Soviet influence, this move had profound economic consequences.

By 1979, under President Jimmy Carter, the U.S. officially recognized the People's Republic of China, setting the stage for deeper economic engagement. American companies quickly recognized the advantages of China’s vast, low-cost labor force and, by the 1980s, began outsourcing production to China to significantly reduce operating costs.

During the 1980s, President Ronald Reagan promoted free-market capitalism and pushed for deregulation and reduced trade barriers. Reagan’s policies, often called Reaganomics, encouraged U.S. companies to expand beyond the country for higher profits.

By then, American firms were increasingly relocating production to China to take advantage of cheaper labor costs. This trend gained more momentum in the 1990s under President Bill Clinton, who actively supported China’s economic integration.

By the time China joined the World Trade Organization (WTO) in 2001, U.S. manufacturers were already heavily invested in moving their operations overseas. This shift supercharged China into becoming the major manufacturing hub for both the U.S. and the world.

According to reports, between 2000 and 2019, nearly nine million U.S. manufacturing jobs were lost to China, with nearly three-fourths of these losses occurring in manufacturing sectors.

The computer and electronics industry outsourced 1.3 million jobs, making up over 36% of the total jobs displaced by trade with China. Meanwhile, the apparel and textiles industry, once a stronghold of American manufacturing, suffered significant job declines as Chinese imports flooded the market, leading to widespread factory closures and layoffs.

The impact of offshoring wasn’t just limited to industries—it fundamentally reshaped entire regions. The Midwest and Rust Belt states, known for their once-thriving manufacturing bases, were hit especially hard. Michigan, for example, lost over 106,000 jobs to China between 2001 and 2018. States like Ohio, Pennsylvania, and Indiana saw similar declines, resulting in closed factories and struggling communities.

The Southern states weren’t spared either. North Carolina and South Carolina, with their strong textile and furniture manufacturing sectors, were significantly affected.

North Carolina saw the loss of about 136,000 jobs during the same period. On the West Coast, California experienced the highest job losses due to offshoring, with an estimated 654,000 jobs disappearing across industries such as electronics and apparel.

The consequences were far-reaching. These job losses had ripple effects on local economies.

When factories closed, people spent less, and towns saw tax revenues plummet. This wasn’t just about lost jobs—it meant the unraveling of entire communities. Unemployment surged, families moved away, and once-bustling towns began to decline.

Middle-class families, who had relied on steady manufacturing work, faced new challenges as economic stability slipped away. As a result, the social fabric of these regions began to change, leaving lasting scars that are still visible today.

What’s more concerning is the imbalance in the U.S.-China trade relationship. Over the years, the trade deficit with China has only grown. In 2022 alone, the U.S. trade deficit with China reached a staggering $367.4 billion. While it’s true that American consumers enjoy cheaper goods because of China’s low labor costs and production expenses, this relationship hasn’t brought the same benefits back to the U.S. economy.

Image credit: Statista

Instead, the flood of inexpensive imports has hit American manufacturers hard. Even though products may cost less, the long-term economic impact on U.S. industries and workers has sparked serious concerns about whether this trade dynamic is truly in America’s best interest.

Make America Great Again

The most famous president to take a hard stance against China’s trade practices was Donald Trump. To counter the growing trade imbalance, Donald played his “Trump Card” to counter China’s influence on American trade: tariffs.

In 2018, the Trump administration imposed severe tariffs on Chinese imports to protect American industries and address long-standing grievances over unfair trade practices and intellectual property theft.

❝

These tariffs are being imposed to encourage China to change the unfair practices identified in the Section 301 action with respect to technology and innovation.  They also serve as an initial step toward bringing balance to our trade relationship with China

President Donald Trump

By the end of 2019, the U.S. had slapped tariffs on approximately $360 billion worth of Chinese goods, with rates ranging from 10% to 25%. These tariffs targeted key industries like electronics, machinery, automotive parts, and consumer goods. Tariffs were imposed on various products, such as solar panels, washing machines, steel, aluminum, etc.

The goal was clear: to encourage American companies to source products domestically or from other countries, reducing the dependence on Chinese imports.

And the impact was swift. China, which had long been the U.S.’s top trading partner, was quickly knocked from this position. By 2019, China was no longer America’s largest trading partner, as companies diversified their supply chains to avoid hefty tariffs. Imports from other countries, like Vietnam and Mexico, surged as businesses looked for alternative sources of goods to avoid the increased costs.

Trump’s trade policies didn’t stop at China. He also sought to renegotiate the North American Free Trade Agreement (NAFTA), which he argued had failed American workers.

Trump succeeded in replacing NAFTA with the United States-Mexico-Canada Agreement (USMCA). The new agreement, which took effect on July 1, 2020, introduced updates to labor rights, digital trade, environmental protections, and stricter automotive rules of origin. For example, USMCA includes a 16-year sunset clause requiring a joint review every six years, allowing for adjustments and updates to ensure the agreement remains relevant.

In short, the goal was to create a fairer, more balanced trade landscape for American workers, ensuring that the benefits of free trade were shared more equitably among the three countries.

While Trump’s tariffs were divisive, they undeniably reshaped the U.S.-China trade relationship and forced businesses to rethink their supply chains. The question remains: did these policies bring back American jobs and strengthen domestic industries?

On March 8, 2018, President Donald Trump signed a proclamation imposing tariffs on steel and aluminum imports during a White House ceremony
Image credit: Reuters

Yes, there was some uptick in the domestic production of commodities such as steel, which saw a 2.4% increase in domestic production. However, according to experts, tariffs affect the average American in terms of cost.

The Congressional Budget Office estimated that tariffs imposed by Trump in his first term cost the average household between $500 and $1,500 per year due to higher consumer prices. Everyday items became more expensive as companies passed along their higher costs.

Old wine, new bottle

It's worth noting that using tariffs to safeguard the national economy is hardly a new strategy for the United States. In fact, it's an age-old American practice that has been employed by several presidents throughout history. Perhaps one of the most infamous examples comes from Herbert Hoover, who, in the early years of the Great Depression, signed the Smoot-Hawley Tariff Act in 1930.

Hoover believed that imposing high tariffs on imported goods would protect American farmers and industries struggling in the times of the Great Depression. The Smoot-Hawley Tariff raised duties on thousands of imports, with average tariff rates climbing to nearly 60% on some products. The intention was to shield American jobs and industries from foreign competition by making imports more expensive.

Image credit: US Department of Commerce

However, the results were disastrous. Instead of stimulating the U.S. economy, the tariff triggered a wave of retaliatory tariffs from other countries, leading to a sharp decline in international trade. Global trade plummeted by nearly 66% during the early 1930s, exacerbating the economic downturn. The Smoot-Hawley Act didn’t protect American jobs as intended; instead, it deepened the Great Depression, causing even greater hardship for American workers and businesses.

Made in USA

If Reaganomics in the 1980s set off a wave of offshoring and relocating supply chains overseas, Bidenomics aimed to reverse that trend by bringing manufacturing back to American soil. As the global landscape continued to evolve, President Joe Biden made it a priority to rebuild resilient domestic supply chains that could better withstand any geopolitical disruptions.

At the heart of Biden’s agenda was the effort to strengthen critical sectors, support American jobs, and reduce dependence on foreign suppliers. Interestingly, the Biden administration did not remove many of Trump’s tariffs on Chinese goods. Instead, it actually added new ones. He added an extra $18 billion to the existing $300 billion in tariffs put in place by President Trump.

One of the cornerstones of Biden’s strategy was the CHIPS and Science Act, signed into law in 2022. This legislation aimed to revitalize America’s semiconductor industry by investing over $52 billion in domestic semiconductor manufacturing, research, and development. The goal was to reduce the U.S.’s reliance on foreign-made chips, especially from Taiwan, South Korea, and China, and secure a steady supply of semiconductors.

President Joe Biden at Intel’s Ocotillo campus in Chandler, Arizona

According to the Semiconductor Industry Association and the Boston Consulting Group, the U.S. share of global chip manufacturing will reach 14% by 2032 because of the CHIPS Act.

Since the CHIPS Act was passed, companies have committed more than $166 billion to boost semiconductor and electronics manufacturing in the U.S. This has led to over 80 new projects in 25 states. Altogether, these efforts are set to bring total investments close to $450 billion, significantly strengthening America's tech industry.

By re-establishing a robust domestic semiconductor industry, the Biden administration sought to secure a critical supply chain that had been severely disrupted during the COVID-19 pandemic, contributing to shortages and rising prices.

Biden’s efforts did not stop at semiconductors. Recognizing the need for a broader strategy, the administration took over 30 new actions to strengthen supply chains across various sectors. One key initiative involved using the Defense Production Act to boost domestic manufacturing of essential medicines.

This move aimed to reduce America’s dependence on foreign pharmaceutical suppliers, ensuring that critical drugs remained available even during global disruptions. The Department of Health and Human Services (HHS) had already allocated $35 million to invest in domestic production of key inputs for sterile injectable medicines, addressing shortages that plagued the healthcare sector.

Final Thoughts

Every single decision made by past presidents has left its mark on this nation—sometimes for the better, sometimes not. But without a doubt, U.S. presidents hold tremendous power when it comes to shaping supply chains and trade, and today, that influence is more important than ever. In a world where alliances can shift overnight, there really are no permanent friends or foes—just changing interests.

That’s why presidents have to use the executive power vested upon them to protect the economy, strengthen American manufacturing, and build resilient supply chains. It’s not just about politics; it’s about making sure American workers, families, and businesses have the support they need to thrive in an unpredictable world.

‍